Dow went up 39, advancers over decliners 4-3 & NAZ gained 57. The MLP index fell 2+ to the 244s. Junk bond funds went up & Treasuries were off a tad. Oil slid lower in the 52s & gold fell 3 to 1340.
AMJ (Alerian MLP Index tracking fund)
US stocks trade cautiously on Fed, trade concerns
The nation's homebuilders reported solid confidence in the housing market in Jun, but levels dropped slightly due to concerns over trade issues, the high costs of construction & the lack of skilled labor. Builder confidence dipped to 64, according to the monthly National Association of Home Builders/Wells Fargo Housing Market Index (HMI). That's down from 66 in May & 68 in Jun 2018. Sentiment has remained in the low 60s for the past 5 months. Anything above 50 is considered positive. “While demand for single-family homes remains sound, builders continue to report rising development and construction costs, with some additional concerns over trade issues,” said NAHB Chairman Greg Ugalde. All of the index's 3 components fell slightly. Current sales conditions decreased one point to 71. Buyer traffic dropped one point to 48 & sales expectations over the next 6 months fell 2 points to 70. Mortgage rates have been falling since Nov of last year & hit the lowest level in 2 years this month, which would normally signal a buying frenzy. But affordable, entry-level homes just aren't available. Many builders say they are focused on building more affordable homes, but hurdles exist. “Despite lower mortgage rates, home prices remain somewhat high relative to incomes, which is particularly challenging for entry-level buyers,” said NAHB Chief Economist Robert Dietz. “And while new home sales picked up in March and April, builders continue to grapple with excessive regulations, a shortage of lots and lack of skilled labor that are hurting affordability and depressing supply.” Looking at the 3-month moving averages for regional HMI scores, the Northeast posted a 3-point gain to 60 & the Midwest was also up 3 points to 57. The West held steady at 71 & the South fell a single point to 67.
Homebuilder sentiment inches lower despite demand for single-family homes
A closely followed gauge of manufacturing in the NY area fell this month to its lowest level in nearly 3 years. The Empire State Manufacturing Index tumbled to a -8.6 reading from 17.8 in May, a 26.4-point drop that was the biggest slide for a data series that goes back to 2001 & well below expectations of 11.5. In all, 22% of respondents reported that conditions had improved since May while 30% said conditions worsened, according to the index, compiled by the New York Federal Reserve, & indicating the difference between plans to expand & contract. It was the lowest reading and first negative print since Oct 2016 & comes amid growing worries about where the broader US economy is heading & what impact the ongoing trade war will have on conditions. Internally, the measure showed sharply diminished business expectations across a number of categories. Net new orders collapsed 22 points to -12 while shipments declined 7 points to 9.7. Employment also looked bleak, falling to -3.5, its first negative print in more than 2 years. The average work week also declined to -2.2, while the prices paid component was little changed at 27.8. However, the prices received index declined 6 points to 6.8, the 4th month in a row for a decline “pointing to an ongoing deceleration in selling price increases,” the release stated. Businesses also were pessimistic about the road ahead. Respondents to the survey pointed to declining business conditions, with a 6-month expectations reading falling 5 points to 25.7. Future orders & shipments fell by a similar amount. Also, the capital expenditures index, a measure of where businesses plan on investing in new equipment & plants, tumbled 16 points to 10.5, while the technology spending index slumped 10 points to 12.8.
A key manufacturing gauge just saw its biggest one-month decline in 18 …
Stocks are drifting sideways with a slight bias on the upside. Investors are concerned about the Fed meeting on Wed. The trade talks are going nowhere, but the bulls remain optimistic. However while the trade talks drone on with no results, the bears are waiting in the wings to take charge.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 52.14 | -0.37 | -0.7% |
| GC=F | Gold | ,343.80 | -0.70 | -0.1% |
Stocks are trading cautiously ahead of a big week for monetary policy. The Federal Reserve meets this week & could give more guidance concerning the future of interest rates. The Fed's 2-day meeting gets underway on Tues with a decision on
rates & a statement that could provide clues about rate direction on
Wed. A top White House official is signaling that a potential final trade deal with China is months away after talks broke down last month, comments that come as US businesses prepare to oppose in droves new tariffs on the Asian nation. In Asia, China's Shanghai
Composite ended the day with a gain of 0.2%. Hong Kong's hang
Seng added 0.4% & Japan's Nikkei started the week flat. In Europe, London's FTSE was slightly lower, France's CAC added 0.2% & Germany's DAX inched higher.
US stocks trade cautiously on Fed, trade concerns
A top White House official is signaling that a potential final trade deal with China is months away after talks broke down last month. That come as US businesses prepare to oppose in droves new tariffs on the Asian nation. Commerce
Secretary Wilbur Ross expects that, should Pres Trump and
Pres Xi Jinping meet at the upcoming G-20 summit in Japan, the best
outcome would be the relaunch of negotiations between the US &
China. A subsequent agreement, Ross warned, could then take “10 months or longer.” “The
most that might come is new ground rules for discussion and some sort
of schedule for when detailed technical talks might resume,” he said. “At the presidential level they’re not going to talk about the details of how do you enforce a trade agreement.” After China allegedly backtracked on previously
agreed upon aspects of the still tentative trade deal, Trump raised to
25% existing tariffs on $200B in Chinese goods, bringing
the total amount of products subject to the duties to $250B. The
White House is also considering extending the 25% tariff to
another $300B in imports, a proposal that is facing stiff
opposition from American businesses. While
the administration argues it is not related to the trade discussions,
Trump also recently signed an exec order to ban US companies from
exporting to Chinese telecom giant Huawei, an action that could cost
the company $30B in 2 years. A
number of companies have raised concerns over the impact of the ban. The US Trade Representative is slated
to begin hearing today from US companies on the impact. From
interior designers to textile manufacturers, firms are expected to
highlight over the 7-day hearing the detrimental effect of higher
duties on one of the country's main trading partners. The
issue for many businesses is the lack of available alternative outside
of Chinese goods.
The nation's homebuilders reported solid confidence in the housing market in Jun, but levels dropped slightly due to concerns over trade issues, the high costs of construction & the lack of skilled labor. Builder confidence dipped to 64, according to the monthly National Association of Home Builders/Wells Fargo Housing Market Index (HMI). That's down from 66 in May & 68 in Jun 2018. Sentiment has remained in the low 60s for the past 5 months. Anything above 50 is considered positive. “While demand for single-family homes remains sound, builders continue to report rising development and construction costs, with some additional concerns over trade issues,” said NAHB Chairman Greg Ugalde. All of the index's 3 components fell slightly. Current sales conditions decreased one point to 71. Buyer traffic dropped one point to 48 & sales expectations over the next 6 months fell 2 points to 70. Mortgage rates have been falling since Nov of last year & hit the lowest level in 2 years this month, which would normally signal a buying frenzy. But affordable, entry-level homes just aren't available. Many builders say they are focused on building more affordable homes, but hurdles exist. “Despite lower mortgage rates, home prices remain somewhat high relative to incomes, which is particularly challenging for entry-level buyers,” said NAHB Chief Economist Robert Dietz. “And while new home sales picked up in March and April, builders continue to grapple with excessive regulations, a shortage of lots and lack of skilled labor that are hurting affordability and depressing supply.” Looking at the 3-month moving averages for regional HMI scores, the Northeast posted a 3-point gain to 60 & the Midwest was also up 3 points to 57. The West held steady at 71 & the South fell a single point to 67.
Homebuilder sentiment inches lower despite demand for single-family homes
A closely followed gauge of manufacturing in the NY area fell this month to its lowest level in nearly 3 years. The Empire State Manufacturing Index tumbled to a -8.6 reading from 17.8 in May, a 26.4-point drop that was the biggest slide for a data series that goes back to 2001 & well below expectations of 11.5. In all, 22% of respondents reported that conditions had improved since May while 30% said conditions worsened, according to the index, compiled by the New York Federal Reserve, & indicating the difference between plans to expand & contract. It was the lowest reading and first negative print since Oct 2016 & comes amid growing worries about where the broader US economy is heading & what impact the ongoing trade war will have on conditions. Internally, the measure showed sharply diminished business expectations across a number of categories. Net new orders collapsed 22 points to -12 while shipments declined 7 points to 9.7. Employment also looked bleak, falling to -3.5, its first negative print in more than 2 years. The average work week also declined to -2.2, while the prices paid component was little changed at 27.8. However, the prices received index declined 6 points to 6.8, the 4th month in a row for a decline “pointing to an ongoing deceleration in selling price increases,” the release stated. Businesses also were pessimistic about the road ahead. Respondents to the survey pointed to declining business conditions, with a 6-month expectations reading falling 5 points to 25.7. Future orders & shipments fell by a similar amount. Also, the capital expenditures index, a measure of where businesses plan on investing in new equipment & plants, tumbled 16 points to 10.5, while the technology spending index slumped 10 points to 12.8.
A key manufacturing gauge just saw its biggest one-month decline in 18 …
Stocks are drifting sideways with a slight bias on the upside. Investors are concerned about the Fed meeting on Wed. The trade talks are going nowhere, but the bulls remain optimistic. However while the trade talks drone on with no results, the bears are waiting in the wings to take charge.
Dow Jones Industrials
No comments:
Post a Comment